How to Build a Modern Company with the Netflix Culture Deck

Recently I’ve been on a little road trip together with Markus Mattern from LearnSuits. It’s very likely that you haven’t witnessed it yourself yet, but if we meet up, we can get a little philosophic with our conversations, sometimes on somewhat geeky subjects like Star Wars theory, and in other cases, we get very deep with matters such as design and running businesses. But that’s a good thing, right?

This time he told me about something called “The Netflix Culture Deck.” Apparently, that is a slideshow from Netflix that is or was used by their HR staff to help new employees understand their ways of operating their business. I found all the approaches to be quite modern, and while they might not be a perfect match for all the companies around the globe, I still thought that the practices are fascinating, to say the least.

So after some time I did a little research, and I managed to find fragments of this legendary document on the Internet. In this article, I wanted to give you my personal summary of the Netflix Culture Deck, and on the bottom of the article, I also linked my sources, so you can check it out in all its glory of hundreds of slides, or not. That’s up to you 😉

Values

A mission statement and a declaration of company values are the basest things when establishing an organizational culture. Spoiler: It usually takes more than ten years of driving values to get to where you’d like to be, so better start communicating values early on. Here is what Netflix values the most:

Judgment

Communication

Impact

Curiosity

Innovation

Courage

Passion

Honesty

Selflessness

Some bullets are easily explained, and some others are rather curious but also make sense in a broader sense.

High performance

Netflix emphasizes that a great workplace does become great because of over the top benefits like “sushi lunches” or “nice offices.” They put a focus on the staff instead and state that stunning colleagues who one can learn from and those who inspire are what makes a great workplace.

They also mention that loyalty isn’t necessary only a positive thing and that smart work beats hard work any day in the week. Also, they outline that “brilliant jerks,” people who are high performers but disrupt culture and team vibe, should not be tolerated and kept. They want their values to be lived – or let the people go.

Freedom & responsibility

Come when you want, do what you like, unlimited freedom – that sounds more like a dream than anything one could stay economical with, right? Netflix tried to stage a framework that drives a culture of freedom, but on the very same notion, they make everyone responsible for their actions.

They advise staff to act like owners and to treat budget as if it was their own money. For instance, they let staff travel, but the employees have to make sure to get a reasonable price for the travel and hotel stay. If they have expenses, they are granted, but such should result in a value-add to Netflix at the end of the day. No time-tracking and no hour-keeping, but you somehow need to show the company that you, as an employee, built something valuable.

What they are doing here is done to keep the responsibility in the team and with the staff rather than putting HR, finance, and other admin folks in the middle who review, approve, reject budget or people who try to book the cheapest flights and hotels for others. The idea is to achieve cost-saving by reducing process work and avoiding chaotic bureaucracy.

Context, not control

This part is not about giving up control as a manager. It’s more about shiting they way you manage from a direct way to a more indirect way by explaining your team the context of deliverables. By giving them a goal definition, you skip the part of telling them how to do something and only harvest the product of their work. You might be surprised how often your teams will get the same (or even better/faster) results using different ways that you didn’t think of.

Without knowing it, I also defined a similar stance to management towards the end of my article about how inspiration and creativity works. In short words, inspired people can only truly excel if you explained your reason and desired outcome to them. Netflix explains this, “high-performance people will do better work if they understand the context.”

Highly aligned, loosely coupled

This is the description of Netflix’ preferred model of corporate teamwork in contrast to the tightly coupled monolith and making use of independent silos.

Cross-functional interactions are set to a viable minimum, and there is a culture of trust between groups. Review and approval activities are also reduced to leverage the established trust. Alignment to strategy must be maintained, or corrective measures have to follow.

Pay top of market

Netflix publicly states that “one outstanding employee gets more done and costs less than two adequate employees” and that they instead have only outstanding employees.

This is achieved by transforming all kinds of HR expenses into big salaries with benefits being made optional, on demand of the employee. What can you pay? Well, you should ask “What could the person get elsewhere?”, “What would we pay for a replacement?”, and “What would we pay to keep the person (if they had a bigger offer elsewhere)?”

Promotions & development

If you want a promotion at Netflix, the job role you’re aiming for needs to be viable. If a manager does a good job, he’s still only a manager and does not automatically become a director. Being a director means to direct a group of managers and their teams, not just to be a great manager of a great team.

Further, you need to be a “superstar” in your current role. This also means that everybody needs to keep progressing to a better version of themselves. This requires excellent colleagues as well as challenging tasks. If the work that you give your team is repetitive and not increasingly challenging, your staff is unlikely to improve, and that is your fault. Change that by sourcing more responsibilities and asking your own superiors for more work as well.

Summary

I think that these practices and managerial models are highly relevant and they match the times we are living in right now. It’s unlikely that you can just grab everything you read here and adopt it as your own 1:1, and yet I am confident that you’ll find at least one (but possibly even more than one) item in here that you can leverage to improve your organization in a way.

As this deck somehow got viral on the public Internet, you might find it in various locations. In case you just quickly want to review the slides, you can check out the Slideshare deck by Barbara Gill here, read the culture page on the official Netflix website here, or buy Patty McCord’s book with more explanation on it all here. You can also watch the TED Talk (TED Institute) of Patty McCord embedded below.

YouTube: Patty McCord: Lessons from a Silicon Valley maverick: new ways of working and collaborating (TED Talks)

Hi there and thanks for reading my article! I’m Chris the founder of TechAcute. I write about technology news and share experiences from my life in the enterprise world. Drop by on Twitter and say ‘hi’ sometime. 😉